Glossary · UK
What is Optional Remuneration Arrangements (OpRA)?
The post-2017 rules that limit the tax savings from salary sacrifice on most benefits in kind.
Full Definition
Optional Remuneration Arrangements (OpRA) are the rules introduced in April 2017 that govern salary sacrifice and other «cash or benefit» choices. Under OpRA, most benefits provided through salary sacrifice are taxed on the higher of their normal cash-equivalent value or the amount of salary given up — removing the Income Tax and NI advantage that used to apply. Crucially, several benefits are exempted and still deliver full tax and NI savings: employer pension contributions, the cycle-to-work scheme, employer-provided childcare and, importantly, ultra-low-emission and electric company cars. This is why pension and EV salary sacrifice remain so popular while sacrifices into things like health screening or gym memberships no longer save tax. Pre-2017 arrangements were protected for a transitional period that has now fully ended.